MANM407 Global Strategy

The report will contain the overall strategy review of Tesla and provide the business report to the CEO on more improvement opportunities by utilizing the techniques and approaches. The report will also include the tasks, which are divided into two parts. The first one explains the external and internal environment along with some competitive advantages of Tesla (Duchin, et al., 2018). In addition, the second task describes the strategy in the Global environment with the justified recommendations for the various strategies of Tesla.

The External and Internal Environment

Tesla’s external and internal environment models mean PESTEL and SWOT analysis respectively discussed here-

Political- Tesla has their achievement and failures at the holds of politicians, since the U.S. government interested in electric vehicles and renewable energy.

Economics- Rates of development are slow in the U.S. but that doesn’t mean stopping individuals from purchasing cars on credit by deals like 0% financing (Teece, 2018).

Social- Many citizens help the idea of investing in their taxes into goods utilizing sustainable resources and sustainable fuels.

Technology- Tech is the root of Tesla’s business strategy. It is a front line in automotive innovation and consisting to develop and create effects on the electric vehicle and battery potentials.

Environment- It is great that driving cars without consumption and burning gasoline, but utilizing electricity determined from plants of coal defeat the objective.

Legal- Some states ban the direct sales of some cars from producers to customers (Thomas and Maine, 2019). At least five states, in that Michigan, is the current one that has been banned Tesla from sales of soliciting; providing drives test; or recruit sales individuals.

Strengths– The Company has the following automotive products; having a top workforce in the business; it is the best in the category of electric cars; it dominates the U.S. electric vehicle sale; diversification, innovation and cross-sell (Teece, 2018).

Weaknesses- It is having complications in the manufacturing; lack of huge volume manufacture; batteries shortages; not to meet a demand that impacts on brand value; having a sole representative.

Opportunities- It has a less expensive car; announcement of a pickup truck; sales extension in the untapped market; bringing battery manufacturing tech in-house.

Threat- It’s goods liability claims; defects in goods; extensive rivals; long-term confidence; consumer adaptation; self-driving cars are a concern for pedestrians (Ahmad and Khan, 2019).Discuss in more detail what you consider to be the 3 most critical factors emerging from your analysis.

The three most critical factors that impact the most from the external analysis contains the two Technology because it is the root of Tesla’s business and another one is Political (David, et al., 2013). The last one is from the internal analysis that is in threat, which is self-driving cars because still, individuals believe to concern for pedestrians.Determine Tesla’s current sources of competitive advantage and critically evaluate how they maintain and build on this competitive advantage.

There are five biggest competitive source advantages of Tesla are-

Supercharger connection- It is having proprietary superfast charging platforms that make potential recharging opportunities for Tesla’s electric vehicle drivers.

Branding- It has grown a reputation for manufacturing superb goods.

Battery chain of supply- Presently, manufactures four vehicles of all-electric- the models of Tesla S, X, 3, and Y, all of that need important battery capacity.

AI- Tesla’s driving ability is autonomous, provided at its huge stage in the ‘Full Self Driving’, is becoming better with the more significant characteristics daily addition (Duchin, et al., 2018).

Updating software- Tesla is having over the air updating, just the way smartphones; computers; and tablets. It is continuous development in its vehicles.

Tesla is maintaining and constructs its competitive advantage because of business strategy likewise- it is entered at the huge end of the market, where consumers are ready to pay a surcharge and then determine down market quickly to huge unit volume and low costs with each consecutive model. Another strategy was it differentiates itself among others by raising its R&D investment each year to improve a high innovative ecosystem for raising returns to a financial scale.Using relevant models for analyzing how organizations enter into foreign markets critically evaluate the motives for Tesla expanding internationally and explain how this impacts their overall company strategy.

Tesla is using the direct selling strategy for entering into the international market, but not only this it is also focused on differentiation; inelastic demand; and low bargaining power of purchasers (Perkins and Murmann, 2018). By direct selling it is come close to consumers, as fast as gets its feedback; and also adapts its offering on a car to the preference and tastes on time before it loses any of them.

The company’s motive is to the domestic market has renewed impact to expand globally, targeting to tap increasing transnational demand for electric vehicles. It aims Asian and European markets, to diversify its income streams. It has now 438 motors shops all over the globe and almost 100 centers of its services.

Tesla’s international expansion uplifted employment by 47% last year. It develops Tesla’s world employee by almost last half-year like the electric vehicle creator expanded performance in Germany and China and also delivered around half a million cars all over the globe (Thomas and Maine, 2019).Provide justified recommendations for the different strategies Tesla can use to compete in the global environment.

Here are some of the justified recommendations for the various strategies Tesla can utilize to compete worldwide are-

Be more-transport regarding the things- It has been heard that Tesla has not developed the amount of Model 3’s on backorder for more than one year. It should reveal the true numbers for its benefits.

Decide quickly about mobility- Appearing rivals from Alphabet and Apple create Tesla bulls on its favourite thought that is its cars of electric will end up charging a sharing ride connection of self-driving vehicles are certainly less (Perkins and Murmann, 2018).

Recruit and empower a chief performing officer- The most common criticism heard about them is that it creates promises but does not keep them. So, a solution is to recruit a big-name chief performer with a reputation as a production guru.

Turn profit- it has consumed too much finance as an investment in its Gigafactory battery plant, the solution is to divide Tesla off its near-concept dependence on the capital markets by turning a moderate profit.

Conclusion

Through the report, it can be concluded that Tesla has to develop its share in the market and stability in the economy. It can be identified by analyzing the internal and external environment of the company. Tesla requires considering strong actions. Although it has been doing great work by entering into the global market and it is an ultimate sign of improvement and innovation.

References

Ahmad, S. and Khan, M., 2019. Tesla: Disruptor or Sustaining Innovator. Journal of Case Research, 10(1).

Bilbeisi, K.M. and Kesse, M., 2017. Tesla: A successful entrepreneurship strategy. Morrow, GA: Clayton State University.

David, F.R., David, F.R. and David, M.E., 2013. Strategic management: Concepts and cases: A competitive advantage approach. Upper Saddle River: Pearson.

Duchin, Y., Shamir, R.R., Patriat, R., Kim, J., Vitek, J.L., Sapiro, G. and Harel, N., 2018. Patient-specific anatomical model for deep brain stimulation based on 7 Tesla MRI. PLoS One, 13(8), p.e0201469.

Perkins, G. and Murmann, J.P., 2018. What does the success of Tesla mean for the future dynamics in the global automobile sector?. Management and Organization Review, 14(3), pp.471-480.

Teece, D.J., 2018. Tesla and the reshaping of the auto industry. Management and Organization Review, 14(3), pp.501-512.

Thomas, V.J. and Maine, E., 2019. Market entry strategies for electric vehicle start-ups in the automotive industry–Lessons from Tesla Motors. Journal of Cleaner Production, 235, pp.653-663.

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